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Supposed you’ve decided to move part of your business overseas, those administrative fees could look like illegal bribes.

Let’s say that to open a manufacturing plant in Southeast Asia you need a permit from the local government.  A government agent there offers to get you the permit within a week – and his commission will only be $1,000.  Back off! Watch your step here.  In many countries, kickbacks and bribes have long been the accepted cost of doing business.  However, the Foreign Corrupt Practices Act (FCPA), enacted by Congress in l977, prohibits bribery of officials in other countries.

It’s illegal to make payments, offers or even promises of anything of value to foreign officials to obtain or retain business or get an advantage.  It’s also illegal to make such payment to a third party (say the official’s wife or sibling).

For over 20 years the United States was the only country trying to prohibit bribery to foreign officials.  U.S. companies complained they faced either bribing foreign officials and risking FCPA prosecution or losing the contract.

Since then, with the urging of the US, international organizations have enacted treaties and conventions aimed at stamping out this practice.  The European Union, the United Nations, and the World Bank have adopted resolutions and policies against corruption which has helped to level the playing field.

You don’t want to get tangled up in bribery!  The problem is it’s rarely easy to tell whether a proposed payment is actually a bribe.  For instance, the FCPA doesn’t prohibit “grease payments” which are fees paid to foreign officials to expedite the actions the government would eventually take anyway, such as issuing a routine permit.  But suppose you need a permit to build an oil pipeline, and a government agent asks for a few thousand dollars for advising you on environmental issues and compliances to make sure you get the permit.  Would that be a “grease payment,” or a bribe for the officials to look the other way?

In light of the new rulings and laws, people of authority rarely ask for bribes, but they may ask for a small payment for advice on doing business there. For instance, if a government agency asks your company to build a park or pave a road in exchange for approval, that wouldn’t count as a “bribe.”

This whole scenario is further complicated by the layers of people it might take to get a job done.  So, if you hire an agent to work with an agent abroad, how do you know he isn’t paying bribes and implicating your firm in corruption?  Know what the deal should cost, so you can tell if money is leaking out.

Because complying with the many overlapping laws is tricky, don’t try it alone.  Hire a lawyer with experience in international business to help you through this minefield.

In fact, it makes one wonder whether it wouldn’t be better just to stay on your home turf!  Such is the way it goes when you start doing business overseas.

Related Tags: illegal bribes, oil pipeline, government agent, compliances, corrupt practices

Depending on the type of investing that you plan to do, you may need to hire a broker to handle your investments for you. Brokers work for brokerage houses and have the ability to buy and sell stock on the stock exchange. You may wonder if you really need a broker. The answer is yes. If you intend to buy or sell stocks on the stock exchange, you must have a broker.

Stockbrokers are required to pass two different tests in order to obtain their license. These tests are very difficult, and most brokers have a background in business or finance, with a Bachelors or Masters Degree.

It is very important to understand the difference between a broker and a stock market analyst. An analyst literally analyzes the stock market, and predicts what it will or will not do, or how specific stocks will perform. A stock broker is only there to follow your instructions to either buy or sell stock… not to analyze stocks.

Brokers earn their money from commissions on sales in most cases. When you instruct your broker to buy or sell a stock, they earn a set percentage of the transaction. Many brokers charge a flat ‘per transaction’ fee.

There are two types of brokers: Full service brokers and discount brokers. Full service brokers can usually offer more types of investments, may provide you with investment advice, and is usually paid in commissions.

Discount brokers typically do not offer any advice and do no research – they just do as you ask them to do, without all of the bells and whistles.

So, the biggest decision you must make when it come to brokers is whether you want a full service broker or a discount broker.

If you are new to investing, you may need to go with a full service broker to ensure that you are making wise investments. They can offer you the skill that you lack at this point. However, if you are already knowledgeable about the stock market, all you really need is a discount broker to make your trades for you.

Related Tags: stock market analyst, full service brokers, full service broker, bells and whistles, wise investments

Outsourcing Your Business Process to China

China is the most populated country in the world filled with talented and skilled workers. It is also a place plagued with unemployment and poverty. This is why China is now entering the world of outsourcing where they can make use of their high population level and talented individuals.

Outsourcing is utilized by many companies in developed nations to save money on business processes. It is used by many companies because of the possibility to increase productivity and at the same time save a lot of money in terms of salary. Outsourcing from another country, particularly developing countries, is very popular because of the cheap labor available.

China is one of those countries who have very cheap labor. Because of this, China became a premier destination for businesses to hire outsourcing companies. With a lot of talented and skilled workers, China is definitely the place where you should outsource your business process. This is a great way to save a lot of money and at the same time, increase productivity with the same quality that talented individuals in your country is able to achieve.

For example, a talented professional in your country can do a certain job for you for a hundred dollars. However, if you outsource the same job to China, a worker with the same talent and skill as the professional in your country can get the job done with the same quality for only twenty dollars. You can clearly see how much you can save in outsourcing instead of hiring regular employees in your business.

Now, try to imagine that you need maybe 1,000 of those jobs done. If you will have it made locally with your own professional, it would cost you 100,000 dollars to get all those 1,000 jobs done. However, if you outsource those 1,000 jobs to china, you will only spend 20,000 dollars with the same quality. You will save 80,000 dollars just to get the job done.

You see how beneficial outsourcing can be to your company. This is why you should consider outsourcing part of your business process to another country, such as China in order to make more profit and decrease heavy workloads to manageable pieces.

However, before you consider outsourcing part of your business process to China, you should consider the fact that not all outsourcing companies offer good quality services. You have to make sure that the particular outsourcing company offers good quality products and services and hires certified professionals to provide that quality.

You also have to consider the outsourcing company you plan on hiring about the history of their previous outsourcing jobs. It is recommended that the company should have enough experience in handling the business process you plan on outsourcing before.

Check out their previous clients and find out if there are companies that hired the outsourcing company with the same jobs that you plan on outsourcing. If they have, it is recommended that you should take a look at their jobs and determine if it’s at par with your standards.

It is also important that once you hired a particular outsourcing company in China, you have to regularly check the job quality in order to determine if the quality is deteriorating or improving.

These are some of the things you should look for in an outsourcing company in China in order to make sure that you will get your money’s worth. So, if you need to save money and at the same time, break down heavy workloads to manageable pieces, you should consider outsourcing in China.

Related Tags: china china, population level, talented professional, time increase, outsourcing companies